Kaohoon Morning Brief – 8 February 2023

1) FSS expects energy sector to bounce back following a recovery in crude prices

Finansia Syrus Securities (FSS) expected Thailand’s SET Index to move in a sideways trend, indicating that the movement range for the past month was between 1,670-1,695 points. The analyst expected the energy sector to bounce back following the recovery in crude oil prices, but upside remains limited as bond yield continuously rose in response to speculation that the Fed could hike rates higher than expected to 5-5.25%.


2) Power says inflation in 2023 will decline significantly

The U.S. Federal Reserve Chairman Jerome Powell said that 2023 should be a year of significant declines in inflation, giving investors hopes for less aggressive rate hikes in upcoming months after a strong job data in January plunged the market in to fear of longer than anticipated rate cycle.

The chairman noted that the central bank did not anticipate nonfarm payrolls to be this strong and the Fed will take a bit of time to handle.


3) Oil prices rise 3% as demand outlook brighten after Fed’s statement on inflation

Oil prices surged over 3% on Tuesday as investors eased concerns following the statement from Fed’s chair Jerome Powell saying that inflation will decline significantly this year, while recovering demand in China continues to boost prices.

The international benchmark Brent crude rose $3.10 or 3.83% to $84.09 a barrel, while the West Texas Intermediate gained $0.33 or 0.44% to $77.47 per barrel.